「温かくしましょう」 紀子さま、日系1世の手を再びぎゅっと握る

The student enrollment decline has prompted changes in budget allocations, despite criticism of perceived 'budget waste' by the local education finance fund (educational budget fund) established in 1972. The budget for 2024 is expected to decrease by around 20 trillion won if the current system continues, but adjustments in the structure of educational projects are necessary to reflect ongoing enrollment reductions.

The government's recent proposal, revealed at the Financial Strategy Consultation Council on the 21st, seeks to end the linkage between proportional allocations of income tax to the educational budget fund. This restructuring aims to dynamically incorporate a certain percentage (20.79%) of income tax into the educational budget fund, without automatically reflecting sudden tax revenues from the semiconductor supercycle.

By increasing the budget by the average year-on-year growth rate of the economy (including price inflation), adjusted by 35% of the average annual change in student enrollment, the new system estimates the 2024 educational budget fund at 78 trillion won. This is a significant reduction from the current estimate of 100 trillion won, saving at least 20 trillion won, which will be redirected to future response funds for early childhood, high school, and lifelong education.

However, this saved amount is still 1.8 trillion won more than the government's mid-term plan based on the semiconductor supercycle. To address concerns from the education sector, the government plans to legislate to prevent a decrease in the total educational budget fund compared to the previous year. Consequently, per-student educational budget is projected to increase from 1,330 million won this year to 195 million won in 2030, reflecting the decline from 547.5 million students to 474.7 million students over the same period.

Dr. Kim Hak-su, a senior researcher at the Korea Development Institute, argues that structural reforms in staffing and elimination of unnecessary projects are also necessary alongside the student enrollment adjustment. Conversely, the education sector protests the unilateral cut in educational finance, maintaining the linkage between income tax and the educational budget fund.

The '2026 Local Education Finance Reforms Urgent Action' by 363 education and civic organizations has been ongoing since May 5th, demanding the maintenance of the income tax 20.79% linkage linkage at the presidential office until May 28th.